The industry’s Top 150 companies fought their way through a tough year. Our 13th annual Lawn & Landscape 150 is a report card on how these corporations performed in 2008. Among the bad news: Aggregate profits of the largest companies by sales were up by only .87 percent. Of just the Top 100 companies, sales were up on average by 1.13 percent – off 4.87 percent based on their predictions from last year. Collective revenue of the Top 150 totaled $7.7 billion, the Top 100 making up $7.2 billion of this total (up from $7.1 billion last year). The Top 150 companies plan an average 1.54 drop in sales for 2009 with the Top 100 companies planning closer to an average 1.81 decline this year.

To compile the list, Lawn & Landscape requested Top 150 submissions via fax, e-mail, our Web site and magazine. We asked companies to report 2008 revenue and growth figures, number of employees, service/client mix and additional data. We calculate and omit any reported revenue streams that aren’t widely offered green industry services (structural pest control, for instance). Our goal is to provide the industry with the most comprehensive and accurate Top 150 list. We make every attempt to identify and contact firms we deem eligible for the list. If you know of a company we missed, please contact Editor Nicole Wisniewski at 330-523-5382 or nwisniewski@gie.net.

When a recession hits the landscape industry, Miami’s Dixie Landscape Co. calls its lean team, which includes 12 employees from different areas of the organization who meet every other week to identify places where they can reduce spending waste.

“We started the lean team three years ago, but it has become much more important now,” says Jeff Reamer, president of Dixie Landscape. “We’ve assigned each member an opportunity within our overhead costs and they come up with smart goals and objectives.”

Lean team members tap into the brainpower of many of the company’s 200 employees to help with their projects, which analyze areas including logistics, utilities, postage, fuel and company cell phone use. “If you give them the opportunity, the people on your team know the answers,” Reamer says.

One of the most successful endeavors has involved logistics. “Through better routing and scheduling, we’ve been able to reduce logistics costs significantly,” Reamer says, adding that rising fuel prices also require ongoing attention.

Overall, Reamer estimates the company has been able to cut 2 percent of its operation costs through strategies recommended by the lean team. And that makes a difference for a $27.8 million company – particularly one whose revenue is projected to be down 18 percent from last year. “We’re in a world of hurt like everybody else in South Florida. The housing market is dead, retail is dead, construction is dead,” Reamer admits. But the lean team helps cut waste where possible.

Fighting the RecessionFinancial crisis or not, optimism and ambitions of continued growth
remain the hallmarks of many of this year’s Top 150.

Success can be measured in any number of ways. In business, it’s often all about the revenue. And these companies – five of the 150 on Lawn & Landscape magazine’s list of the highest revenue-generating firms in the U.S. – have that. But sometimes it’s about more than the numbers.

As you’ll learn from the organizations profiled here, success, particularly in a tough economy, is also about the way a company rises to face a challenge. All five of these organizations are poised to stand their ground in the face of uncertain economic conditions. They may not bring in quite as much cash as in past years, but it’s still all systems go.

For Swingle Lawn, Tree and Landscape Care in Denver, it means implementing a rational response plan to guide decision-making in every area of the company. The management team at Gothic Grounds Management in Valencia, Calif., knows when to enlist outside help – in this case, a group of savvy MBA students. For Heads Up Landscape Contractors in Albuquerque, it’s all about saving money by reducing green waste and water use. Dixie Landscape Co. in Miami relies on an internal lean team to trim spending. And Becker Landscape in Indianapolis has discovered that the secret to its success lies in investing in employees – financially and emotionally.
But don’t take our word for it. See for yourself how these five companies are redefining the notion of “success,” and steal one of their ideas or let them inspire you to come up with a recession-fighting solution in today’s turbulent times.

Become Financially WiseWant productive, focused employees? Take financial worries off of their minds like Becker Landscape Contractors does.

“One of the goals is to make our staff more financially wise,” Becker points out.

Many of the company’s approximately 130 employees have signed up for the course, which is open to spouses as well. To allow couples to attend, the sessions will be held in managers’ homes after work, with childcare provided by the company.

Each session focuses on a topic related to money management principles. “We talk about how to balance a checkbook and other basics, and the majority of our labor force hasn’t had this training,” Becker explains. “Even people who are more money savvy want in on it so they can make strides in their personal financial lives.”

The company launched a pilot program in October 2008. Dave Ramsey, the owner and creator of “Financial Peace,” is a well-known debt reduction expert, host of the nationally syndicated radio program The Dave Ramsey Show and author of books including The Total Money Makeover. “He’s smart and easy to listen to,” says Jeffrey Fox, director of human resources for the company. The employees who participated in the pilot program will lead the fall courses for their peers.

Employee packets for the program cost $150 to $160 per employee. Participants can pay the company for their packets in installments tailored to fit their financial situation. “We want our employees to pay some of it so they’re committed,” Fox says.

The company is footing the bill for facilitator materials and childcare – costs that are well worth it to Becker. “We’re going to get better retention and smarter, savvier employees,” he says. “Anytime they’re in a situation where they’re in a learning mode that raises their self-worth.”

Also, “if we can help our employees become at peace with their finances, they’re going to be more focused, productive and efficient when they’re here,” Fox adds.

“Financial Peace” is just one component of the program. “We’re an open management company – balance sheet information is shared monthly and weekly,” Becker says. “So employees are aware of where the company is financially as well as where their finances are personally.”

Nick DePasquale The UCLA’s Applied Management Research Program offers MBA students an opportunity to complete in-depth strategic studies for participating companies.
Valencia, Calif.’s Gothic Grounds Management joined the group because “we wanted a fresh look at the business,” says Nick DePasquale, the company’s vice president and a UCLA alum. “We felt the MBA students were at the cutting edge and would be more in touch with newer systems.”

Plus, working with the students was a more cost-effective option than hiring a typical consultant – Gothic Grounds Management paid a $12,500 partnership fee plus out-of-pocket expenses the team incurred, a reasonable amount considering the results.

“In November 2008 we had initial meetings to develop a goal for our team and to review our growth strategy,” DePasquale says. “A lot of time was spent gathering the research materials the students needed to understand our business – historical financial statements, business plans, customer data, etc.”

Armed with that information, the student team spent two quarters reviewing the company’s strategic plan. They also sat in on branch managers’ meetings, quarterly sales meetings and business plan presentations and visited each of the company’s branches. The students also had weekly meetings with the management team, which typically lasted a couple of hours. The team made its final presentation, including a several-hundred-page report, to Gothic Grounds Management in April.

The students analyzed the company’s growth possibilities. Through their research, they recommended where the company’s time and money could be used most effectively. “They helped us realize that maybe offering a new service line isn’t the right thing to do at this time, and they surveyed all of our clients and helped us understand what we were missing,” DePasquale says. For instance, although clients were proponents of going green, they learned they would not opt for a greener provider unless it meant lower costs.

“We’re in the process of creating a five-year strategic plan, and we have redirected some of our resources as a result of the report,” DePasquale says. “They told us to focus on training and expansion of our organic sales growth. We’ve made some of those changes with very encouraging preliminary results.”

Perhaps best of all, despite the economy, the students confirmed Gothic Grounds was on the right growth track. The company brought in $18.3 million last year, and their business plan calls for $21.96 million this year.

Given the opportunity, Gothic Grounds would consider teaming up with UCLA students again. “It gave us a good opportunity to look inward at our business and envision what our company is going to look like in five years,” he says. “They confirmed many of our working theories and challenged others.”

Gary Mallory Heads Up Landscape Contractors, a commercial maintenance and installation firm in Albuquerque, N.M., has established itself as a leader in the effort to “green” the green industry at a time when interest in sustainable practices continues to grow, benefitting the company’s bottom line, according to President Gary Mallory.

For starters, the company uses mulching mowers to reduce the amount of grass clippings that must be hauled away and picked up offsite. Employees sort the green waste they do pick at the company’s headquarters.
Once the dumpsters are full, the contents are hauled to the city’s composting facility rather than the city dump. After the waste is composted, the company buys it back for landscaping. The company recycled about 2 million pounds of waste in 2008.

In addition to eliminating waste and conserving water (when the composted clippings are used as mulch around plants), the process also reduces company costs. “If we don’t recycle it, we throw it in the garbage, and then we pay someone to haul it away and pay fees at the city dump,” Mallory explains.

Heads Up Landscape started as an irrigation-only company 34 years ago. The company often works with large developers, who must demonstrate they won’t exceed water use restrictions in order to obtain zoning approvals.
In addition, the city of Santa Fe (which Heads Up Landscape also services) passed ordinances requiring cisterns for commercial and residential buildings. Heads Up Landscape installs the cisterns so companies can harvest rainwater for use on their landscapes.

The company has a large 12,000-gallon cistern at its headquarters, too. “It works because we get to use it for our landscaping and can try out different pumps and filters, so we have our own lab on-site,” Mallory says.
In addition, Heads Up Landscape designs recessed landscape islands in parking lots so that rainwater drains into planters rather than running off the pavement. With big commercial buildings that produce a lot of runoff, the company will construct a dry streambed that channels water to plants on the way to a retention pond.

At construction sites where builders are seeking LEED certification through the U.S. Green Building Council, Heads Up uses a tree grinder to shred and pulverize leftover scraps of drywall, which contain gypsum and can be used as a soil amendment.

When the company purchases new vehicles, it opts for models that get 36 miles per gallon – a dramatic improvement from the 16 mpg of its older trucks. “Our goal for our trucks is to double fleet mileage in the next three years. We can’t do it all at once, but as we replace trucks that’s what we’re moving toward,” Mallory says.

Even the small moves help, he stresses. “What we’re constantly trying to do is look at things with fresh eyes. We’re finding that people in different departments come up with good ideas,” he says. Based on employee recommendations, the company recycles all paper and plastic in the office and oil from the shop and even sells plastic plant buckets back to growers at a reduced cost.

Mallory estimates company revenue this year will be $21 million, down from last year due to fewer installation jobs. He recognizes when times are tight going green isn’t always a high priority. Some customers believe in going green through thick and thin; others are more concerned about how much they’re spending right now.

“It has always seemed like the right thing to do, but it’s especially tough in this economy. If it’s the right thing to do but it adds costs, it’s going to be a tough sell,” Mallory says. “But finding something that lowers costs and is the right thing to do is the perfect marriage.”

A Rational ResponseAn opportunities checklist and the 'one-more-job-a-day' initiative - among others -
are Swingle's answers to recession.

Even before the economy took a nosedive, Denver’s Swingle Lawn, Tree and Landscape Care was ready, thanks to its rational response plan.

Swingle originally designed the plan to address the 2001 recession and drought and water restrictions that hit Colorado in 2003. Once the company heard rumblings about the economy, CEO Thomas Tolkacz and his executive team rolled out the plan again.

The goal: To create a leaner, more efficient company that creatively solves problems in the present and considers solutions for the future.

Despite today’s economy, Tolkacz says that focus has placed Swingle in a strong cash position that allows for flexibility and a degree of comfort in uncertain times. Although the company has budgeted for $14 million in 2009 (down from $18 million in 2008), Tolkacz is confident. “It will come back. We just need to be flexible,” he says.

The rational response plan includes a number of components, including communication. “We over-communicate to avoid rumors, provide people comfort, answer common questions and not let employees’ imaginations get in the way of common sense,” Tolkacz says.

In 2007, when the executive team sensed the impending downturn, all employees met twice a month to encourage input. “We realize we don’t have all the answers. We want employees’ feedback and are trying to incorporate it into the decision-making process,” Tolkacz says. For instance, employees were behind the push to decrease the frequency of those all-staff meetings to bimonthly to reduce scheduling conflicts and maximize work time.

Still, some decisions, such as analyzing expenses, are best handled by the executive team. Swingle shut down one of its three facilities this year to reduce operating costs, and also implemented forced layoffs to ensure it was paying only those who were contributing and vital to the business (currently, the company employs 190 people). “That allowed us to alleviate some management distractions, and at the same time those people who were the A and B players saw their contributions, work habits and attitudes being recognized,” Tolkacz explains.

Another way the company is strengthening its position is through its “job-a-day” initiative, which encourages employees to squeeze in one more job each day. Rational response doesn’t have to be about complicated processes and procedures. “The real message is about a little bit of hustle – if everybody finds time for one more job a day, we’re going to be that much more profitable,” Tolkacz says. “We improve our service to customers, get done faster and increase profitability.”

All of these changes stem from the “opportunities checklist” – a master list of opportunities developed and maintained by the company’s executive management team and facilitated by company president John Gibson. Some of the opportunities on the list never make it past the idea stage; others are assigned to a team member, researched and implemented. “It’s a working tool that removes emotion from the decision-making process,” Tolkacz explains. “We force-rank opportunities so we can make smart decisions. It’s not a perfect science, but it at least gives us a tool to evaluate certain things.”

Moving forward, Tolkacz says the goal is to survive and thrive. “We’ve been forced to be creative, reduce fixed costs, increase efficiencies and eliminate waste,” Tolkacz says, “and I think we’re going to end up with higher profitability than we’ve had in the last two years because of it.”